October 28, 2016 Vince Valholla

Spotify Isn’t Budging on Their Free Streaming Tier, Rejects Apple Music’s Exclusive Strategy (Updated)

Last year, I predicted that Spotify would eventually be forced to remove their free tier due to pressure from major labels. Will it happen one day? I’m not so sure anymore because Spotify executive Troy Carter recently reiterated that it will retain its free tier.

According to TechTimes, other executives also said that they won’t be engaging in signing exclusive deals with artists to release music. It’s clear, Spotify wants to set itself apart from the competition. Their free tier allows them to do this since anyone can sign up and enjoy their full catalog (with ads). Troy went on to say that “I don’t think we’re ever going to get to a world where everybody on the planet is going to pay for music,”. A free tier listener “may never convert to a paid subscriber … but they’ll be able to afford a concert ticket, they’ll be able to afford a t-shirt.” . He’s right, and I think I finally can see what Spotify’s “end game” is.

As far as exclusives, I’ve kind of had mixed feelings about it. At first, I thought it was a bad thing for music fans but we did a few exclusives this year, with success (Disclosure: In case you’re wondering, I’m Chairman and Chief Executive of Valholla Entertainment, a Miami-based music label and management company) . So, I changed my stance a bit. Don’t get me wrong, exclusives for long periods of time really are a downside for fans, but an exclusive for a few days or a week, to me, is fine. Especially if the album is available for platforms on all platforms. If you really are a fan, buy the album or wait until the album is available on the streaming service you subscribe to.

In closing, Spotify’s free tier is smart for everyone, and exclusives are fine with me, as long as it’s not for an extended period of time. Jimmy Iovine stated that he’ll be continuing to pursue exclusives. And I don’t blame him.

Update: April 4th

Spotify and Universal Music Group announce global, multi-year license agreement

On April 4th, Spotify announced a multi-year deal that would allow UMG artists to Window releases to only Paid subscribers. What that means is, only paid subscribers will have access to select UMG releases for two weeks.

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Vince Valholla

Vince Valholla is Chairman/Chief Executive of Valholla Entertainment, Inc. Valholla is a full service Music Label & Management Company based in Miami, FL. Valholla's 2015 release of Kirby Maurier's "Doing The Most" was one of the highest selling independent R&B albums in the South Atlantic Region. His opinion is his own.

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